US HRC: Prices flat as market stalls

US hot-rolled coil (HRC) prices have stalled out amid limited spot transactions and offers.

The Argus weekly domestic US HRC Midwest and south assessments were both flat at $1,950/short ton (st) ex-works. Lead times in the Midwest shrank to 5-6 weeks from 5-7 weeks.

One integrated mill reported selling HRC between $1,960-1,975/st for transactions between 100-500st, but multiple offers came in from $1,900-2,000/st.

Overall activity was muted as many buyers were on the sidelines waiting to see where prices are headed.

Labor and parts issues are weighing on demand in the market as some steel consumers have had to cut production because of a lack of workers or other parts to complete manufacturing of goods.

JSW's Mingo Junction, Ohio, electric arc furnace (EAF) mill restarted operations on 6 October after going down on 26 September because of a burn through.

Integrated steelmaker Cleveland-Cliffs finally entered the US scrap market on 11 October, announcing the purchase of Ferrous Processing and Trading (FPT) in a $775mn deal that is expected to close in the fourth quarter. Cleveland-Cliffs estimates that FPT controls 15pc of the prime scrap market.

The purchase has already intensified competition for prime scrap supply, which is generated by manufacturers and steel processors.

HRC import prices into Houston were flat at $1,500/st ddp.

The spread between #1 busheling scrap delivered US Midwest mills and HRC selling prices rose by $18/st to $1,439/st. The spread is over three times as wide as the $387/st from a year ago.

The Argus weekly domestic US cold-rolled coil (CRC) assessment fell by $40/st to $2,200/st while the hot-dipped galvanized (HDG) assessment declined by $20/st to $2,220/st.

Lead times for CRC slipped to 5-8 weeks from 6-9 weeks while HDG lead times fell to 7-8 weeks from 8-10 weeks.

Most of the CME HRC Midwest futures market fell across the board in the last week, with the market falling further into backwardation through the next five months. November futures pricing fell by $35/st to $1,795/st, while December dropped by $33/st to $1,635/st. The January futures price also fell, decreasing by $47/st to $1,499/st, with February pricing falling by $43/st to $1,373/st. March pricing fell by $55/st to $1,275/st.

Plate

The Argus weekly domestic US plate assessment as flat at $1,840/st delivered on no reported transactions. Lead times were also flat at 5-10 weeks.